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TMI Blog1970 (7) TMI 75X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Orissa Co-operative Societies Act, 1951. It consists of weaver members and deals in silk and tussore goods and is governed by its registered bye-laws. Bye-law 4 which deals with the objects of the society so far as is relevant may be quoted. "Bye-law 4.-The object of the society is the development of handloom silk industry and the improvement of the economic condition of the weavers residing in the area of operation. For the purpose of attaining this object, it shall be competent ..... (c) To purchase silk yarn and other raw materials and advance the same to the weaver members who shall convert them into finished goods and deliver them to the society, to pay wages for such conversion ..... (e) To act as an agent for marketing th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned were distributed amongst the members themselves in accordance with the bye-laws. The assessing officer did not accept this contention and held that the society is a "dealer" and assessed it to tax. The order was upheld in appeal by the appellate authority and also the Tribunal. Being moved by the assessee, the Tribunal has referred the above question to this court. 4.. It is contended by Mr. Roy appearing for the petitioner that the petitioner-society is not a "dealer" and that it neither "carries on any business" within the meaning of section 2(c) of the Act nor does it "purchase goods from its members or supply goods to its members" within the meaning of the latter part of that section. According to him "carrying on business" refers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manager or agent of a dealer who resides outside Orissa and who carries on the business of purchasing or selling or supplying goods in Orissa shall, in respect of such business, be deemed to be a dealer for the purpose of this Act." As the definition itself shows, a co-operative society can also be a dealer provided the other conditions are satisfied. Carrying on own business of buying or selling goods is essential for a person to be a dealer. It may be that he is selling somebody else's goods, but the business which he carries on must be his own. The fact that such a person would be receiving commission or remuneration for selling somebody else's goods would not make any difference provided that the business of selling belongs to him. Un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e fixation of the price; they do not select the buyers, and there is no contact between them and the buyers. The mere fact that in the receipts given to the buyers at the time of purchase by them of the fabrics the name of the weaver who manufactured that particular fabric is mentioned does not in the circumstances of the case, alter the situation or constitute that particular weaver the seller of the goods. The main plank of Mr. Roy's argument is that the society itself does not derive any profit by the transaction of sale and whatever profits are made are diverted to the weaver members. We are not concerned here with the fact whether the society retains such profits out of the transaction or whether it diverts the entire profit to the mem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the various purchasers of the goods from his shop known as Lakshmi House. But the labels of the Textile Marketing Organisation, pasted on the goods, were taken out by him and he affixed his own labels, describing himself as "Lakshmi House, agent of the Textile Marketing Organisation". The sale prices actually received by the assessee from the various purchasers were remitted by him at regular intervals to the Textile Marketing Organisation who used to send a supervisor periodically to verify the stock of goods in the assessee's possession and report about the same. After annual audit the assessee was given 5 per cent. commission on the total sales effected by him, on behalf of the Textile Marketing Organisation. On these facts, their Lord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... themselves is clearly unacceptable, because the society is, in the eye of law, a separate entity of its own as distinguished from the members who constitute it. To us, it appears, that the facts and circumstances of this case are more akin to The Indian Coffee Board v. The State of Madras decided by a Bench of the Madras High Court and reported in 5 S.T.C. 292. Under the Coffee Market Expansion Act (7 of 1942) a Coffee Board was constituted. Under that Act, the coffee produced by a registered owner is divisible into two parts: (1) the internal quota which the registered owner is empowered to deal with, and (2) the excess over the internal quota which he is required to surrender and is not free to sell in the market. The effect of surrenderi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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